Washington, D.C. (Reuters) - The U.S. Senate on Wednesday narrowly
voted against opening the Arctic National Wildlife Refuge to oil
drilling, defeating the centerpiece of President Bush's energy policy.

In a tug of war largely along party lines, Senate Republicans called
for allowing oil companies to explore the sprawling refuge, on Alaska's
northern coast, to help reduce U.S. oil imports. Democrats, a few
moderate Republicans and environmental groups argue the pristine
wilderness should be left untouched in favor of stricter oil
conservation measures and drilling elsewhere.

The vote was 52-to-48 to reject drilling in ANWR.

Congressional sources said key votes were cast by Minnesota Sen. Norm
Coleman and Oregon Sen. Gordon Smith. Both Republicans opposed opening
the refuge to drilling in the past, but had been the target of heavy
lobbying by their party on an issue that is important to the White House
at a time when the nation is on the brink of war with Iraq.

MEASURE ATTACHED TO BUDGET

Republicans tried a new strategy to open the Alaskan refuge to
drilling by attaching language to a pending federal budget for 2004. The
measure would have included in the budget more than $2 billion in
federal revenue collected from leasing fees that oil companies would pay
to drill in ANWR.

Under Senate rules, a budget resolution needs only 50 votes to pass,
unlike controversial bills that require 60 votes to end debate before a
floor vote.

Drilling in ANWR has been repeatedly endorsed by the Bush
administration as the single best way to reduce U.S. reliance on foreign
oil.

Republican Sen. Conrad Burns of Montana criticized green groups for
spreading what he called "misinformation" about the impact of
drilling on wildlife and land.

"What's wrong with finding out how much oil we have?" Burns
said. "It's a land that we can take care of and still use the
resources it provides."

Burns and other Republicans noted that drilling in the refuge would
create badly needed jobs, and new technology would limit any damage to
the land or wildlife.

"The solution to our long-term energy problems is not to just
open this environmentally-sensitive area to drilling," Bingaman
said during the Senate debate. "This does not reduce in a
significant way our dependence on imported oil."

Bingaman cited federal energy data estimating that any oil production
from ANWR would not begin until about 2012, and that the field would be
largely played out by 2025.

Instead, lawmakers should offer tax incentives to encourage renewable
energy development and improve energy efficiency, Bingaman said. Oil
companies should also explore the nearby Alaska national petroleum
reserve, which is available for leasing, he said.

On Tuesday, a Reuters survey of all 100 senators showed 42 lawmakers
-- five Democrats and 37 Republicans -- said they would vote to keep the
ANWR provision in. Five senators -- all Republicans -- said they were
undecided on the drilling issue.

Arizona Republican Jon Kyl's aides refused to say how he would vote,
although Kyl supported ANWR drilling in the past.

The refuge covers 19 million acres in northeastern Alaska, but the
Bush plan would open only 1.5 million acres (607,000 hectare) on the
coast to drilling.